Zimbabwe Says Days Of The US Dollar Are Numbered, Pushes For Gold-Backed Local Currency

Topping off a weekend of surreal news is the announcement from the Central Bank of Zimbabwe that the country is now evaluating introducing a gold-backed Zimbabwean dollar, and, in keeping with the Salvador Dali feel to the past 48 hours, that the "days of the US dollar as the world's reserve currency are numbered." Yes. Zimbabwe, the same place that two years ago sported a brand new crisp Z$100 trillion bill. What is just as odd is that this news comes less than a week after Iran's President Mahmoud Ahmadinejad criticized US economic policies, saying that the paper currency created by the American government is taking a heavy toll on the global economy. While Zimbabwe, which now transacts almost exclusively in foreign currencies such as the USD and the South African Rand, is actively considering ways to return its own currency into circulation, the man who has up to now served as an inspiration and a role model to Ben Bernanke, Gideon Gono, said the country should consider adopting a gold-backed currency. “There is a need for us to begin thinking seriously and urgently about introducing a Gold-backed Zimbabwe currency which will not only stable but internationally acceptable,” he said in an interview with state media... That giant ripping noise you hear is the Chairsatan tearing down each and every 20x10 poster of Gideon Gono, lining the hallways of the Princeton Economics department.

THE central bank says the country must consider adopting a gold-backed Zimbabwean dollar warning that the US greenback’s days as the world’s reserve currency are numbered.

Government ditched the Zimbabwe dollar in 2009 after it had been rendered worthless by record inflation levels and adopted multiple foreign currencies with the US dollar, the South African Rand and the Botswana being the most widely used.

“We need to re-think our gold-mining strategy, our gold-liberalisation and marketing strategies as a country. The world needs to and will most certainly move to a gold standard and Zimbabwe must lead the way.”

Gono said the inflationary effects of United States’ deficit financing of its budget was likely to impact other countries to leading to a resistance of the green back as a base currency.

We wonder what took Zimbabwe, a country rich in natural resources, so long to figure out that it was nothing but a puppet in the hands of western monetary interests:

“The events of the 2008 Global Financial Crisis demand a new approach to self reliance and a stable mineral-backed currency and to me, Gold has proven over the years that it is a stable and most desired precious metal,” Gono said.

“Zimbabwe is sitting on trillions worth of gold-reserves and it is time we start thinking outside the box, for our survival and prosperity.”

Curiously, the same can be said for Russia, and, soon enough, after it will have bought every last resource and global extraction company, China.

By now it is far too clear that it is an "Onion" world out there. Will it be all that surprising if Zimbabwe is the first country, following its brief and painful detour into hyperinflation, to introduce a gold-backed currency?

"While Zimbabwe, which now transacts almost exclusively in foreign currencies such as the USD and the South African Rand"

This is what works well. Competing currencies. That's what is happening right now in the US. We transition from dollar, for everyday use, to Gold and silver and soon other commodities. Are you listening Bennie and Timmy?

Or NATO will back a soon to be named rebel force to overthrow the radical hard money government. Special zero interest US "Military Bonds" will be bought by the FED to fund the overthrow of any government proposing gold backed currencies. Gold backed currencies will be deemed weapons of mass destruction, and those countries developing such weapons will be dealt with swiftly.

QE3 will be nails in to the coffin on the dollar. Once that happens, replacement of the dollar as the international standard will happen rather rapidly. I imagine this has already been in the works since Obama took office.

FORGET change problems, getting a token or a sweet as change and being stuck with greasy soiled notes. This is because the United States Federal Reserve has agreed to supply coins and replace soiled notes to Zimbabwean banks in a bid to end change problems in the economy, businessdigest has established.

According to sources, representatives Bankers Association of Zimbabwe led by its president and FBC Bank boss John Mushayavanhu met Finance minister Tendai Biti last week to map a way forward in dealing with change problems in the economy.

The sources, said the US Federal Reserve have “formally” agreed that Zimbabwe’s economy is now dollarised and will now supply Zimbabwe with coins and replace notes.

Gono managed the currency until it was worthless. At that point it stabilized. Mission accomplished with complete success. Fucking brilliant. Yeah, I guess you would listen to him. Meet me in Brooklyn, I've got a prime business venture to sell you. It's a toll collecting venture where traffic can be billed both ways. Involves a bridge.

Would it not be odd if a FIAT BASED DEBT is converted to GOLD BACKED DEBT? Are the bankers who used "ponzi" schemes to encumber the masses with fiat, now going to be paid in GOLD backed regime?

How about some honesty and DEFAULT on DEBT and obligations that are unpayable anyway? Yes, some very large and highly levered banks will fail and their minions will be screaming that the sky is falling. Bankers want indentured servitude and defaults will be a way to teach them prudent risk management. Cut the gobberment down to size, that means cutting guns and butter programs in favor of what our constitution promised? It is only from the ashes of default and restructuring can we then gravitate to a gold backed currency.

All those goofy, perma-idiotic libertarians who call for the US dollar to be collateralized by gold have absolutely no idea what they are asking for.

That would, by proxy, collaterilze our ~$14T in treasuries and keep the fruits of the American laborer flowing into bankers' pockets forever. Wouldn't be hilariously ironic if the anti-Fed libertarians get their gold-backed wishes right as the Federal Reserve becomes our primary creditor with $14T in secured coupons?

LOL

And for all those libertarian morons who want to tell me that it is illegal to repay fiat debt with anything other than fiat debt, please point to the law that authorizes the US Treasury to collaterilize unpayable swaps at AIG.

There is little doubt that you - as a likely libertarian - have full command of all the low-brow, barnyard profanities in the English language. I've never met a doomer libertarian wingnut who wasn't a maestro of profanity and vulgarity.

The real question, though, is whether or not you're capable of defending your seemingly hypocritical, one-dimensional, rigid ideologies, which, when followed to their inevitable conclusions, are chalked full of contradictions and fallacies.

Simple question for you: what happens to the ~$14T in US debt if the US dollar is collateralized by gold?

Statists such as you, utterly unable to attack the philosophically and morally consistent and coherent libertarian position, invariably are forced to resort to puerile and empty ad hominem attacks in the vain attempt to counter that which you rationally cannot.

THERE IS A SLAUGHTERHOUSE 40 MILES AWAY, AND I NEVER THOUGHT OF THAT! I KNOW THE SON OF THE OWNER, SO I'M SURE I CAN GET SOME KICKIN' SCRAPS! MAYBE I CAN SELL SOME SCRAPS TO THE LOCAL WALMART TO HELP REDUCE COST-IMPUTS, OR WHATEVER.

Can someone explain to me what a margin hike is, and why this is relevant to the silver eagles I bought last month? Can I assume that margin means "profit margin" and those people who sell silver are now allowed to make more money?

I ALREADY HAVE CANNED FOOD!!!!!! I HAVE MORE CANNED FOOD THAN I WANT!!!!!!!!!!

I thought that maybe I could sell at this price, and buy it back cheaper. Someone near the top of this conversation said gold was going to pop, so I thought that maybe I'd should be safe and sell some gold to lock in my profit margins that I already have! You need to think like a CEO.

Man! Thanks for digging into the history of things to completely own Gunslinger's ass.

I guess that he doesn't realize that we can just go into his profile and track what he said yesterday, last week, or last month (maybe not, he's only been around for 3 weeks). While I certainly don't have the veracity and determination to go into a particular account tracking, I will say that I greatly appreciate the fact that you do.

You have proven that Gunslinger is either: speaking out of his arse, speaking out of both sides of his mouth, and/or is entirely two different people altogether (either physically or mentally). In either case, he's a joke, and should be viewed as such.

Goddamn. I've never met anyone so utterly incapable of keeping up with current fucking events.

Gulf of mexico just gets gang raped by insane corexit dumping psychos. Flood and drought everywhere, christchurch new zealand and Haiti just get fucking devastated with minor hits all over the place and fucking japan is leaking more goddamn radiation than this planet has ever seen outside of a goddamn containment vessel.

And you are going to rip holes in some weak doomer philosphy with some type of sheparding destructive crushing force.

Are YOU FUCKING INSANE? No I know insane people who look and you and go GODDAMNIT. That guy is insane!!!

The first thing that would happen would be to try and value the dollar vs. gold. Good luck with that given the vast amounts of USD floating around the world. However, once having fixed that value, convincing the public to continue increasing the debt would be a herculean task. Perhaps with some sort of fiscal sanity we could eliminate the burden over time.

Your ridicule only suggests that you see no vision other than a catastrophic collapse and default, hardly the optimal solution for most Americans. Similarly, continuing to add to the vast, toxic, choking amount of debt makes no sense either. Adding billions of expenditures through debt requires repaying the billions plus INTEREST which as it exponentially increases becomes impossible. So, pay me now or pay me later, the degradation of the value of our currency has to happen as debt has to be added to debt to mathematically have us stay ahead of the the compounding interest on the pre-existing debt and the debt we would have to continue to add.

Gotta love a Lone Star statee making fun of libertarians. Still panning for fiat outside of Austin City Limits there, carpet-bagger?

Your question is irrelevant and is symptomatic of a misunderstanding of collateral and currency collapse. Moving to a gold standard does not collateralize the currency, it just anchors it and limits its buying power to the physical stock of the underlying.

Notional credit exposure doesn't change in a currency re-denomination event, it just converts from one form (fiat) to another (gold-backed fiat, or just gold). And so...

...THE RELEVANT QUESTION IS WHETHER DEBTORS WILL HAVE SUFFICIENT GOLD TO REPAY THEIR DEBTS.

We know the answer in aggregate is "not even close," although some will have the capacity. Void of the ability for the deficiency to be printed away, the debt gap will converge rapidly by the combination of two things: one, the value of gold will go up enormously and two, a portion - maybe a large portion - of the debt will be written off. Even as creditors foreclose on the toxic assets, they will absorb substantial losses. Meanwhile, those who hold the toxic assets but lack sufficient gold to cover the debt will be bankrupted like a lightning strike (twern' nothin left but a scorch mark...)

The wealth effects of this will be incredible. A massive, rapid transfer of wealth to those whose gold holdings are proportionately greater than their current fiat-denominated holdings - people like me and the physical PM holders here that get bashed here continually by light-thinking sheep with no conviction nor ability to see the plain truth in front of them.

If this is over your ten-gallon head, I can arrange for a hunting trip with Dick Cheney for further elaboration...

What happens to the $14 trillion if it is collateralized by gold? What gold? If that occurs the dollar goes to its true value. Now, that will include future liabilities as well as well as accounting for all domestic debt as well as assets. Gloomy enough for you? If not, then the debt is still debt. It's still there, demanding settlement.

Chirpy still?

Yes?

Oh of course you are, you've got faith. What with them doing God's work 'n all.

Tex - Three weeks ago.. " Is gold good or should I invest in beans in the can" "Should I buy gold now or wait till it goes wayyy up"
I defended you once goober now your NSA handlers should take you behind the farm at langley and kick your ass..

You are entirely miscalculating debt as compared to the price of a single commodity. Obviously, as paper money is inflated over time, not all goods will have a similar or concerted rise in price, only those whose demand is increased by the inflation of the currency will see a rise. This is why you can see a dramatic increase in the price of producer's goods, yet also have a dramatic decrease in housing prices, as we are seeing today.

Further, you ignore that we have a debt-based currency, of which does not only include the principle debt, but also the interest upon that debt. Add into that the dramatic and profligate increases of derivative debt contracts, of which dramatically surpass the productivity and current account balances of the entire world. The fact is that all of the debt based in US dollars far exceeds the amount of money in existence (as well as all of the productivity in existence). Obviously, the debt will far exceed the totality of value of any single good in the economy, and in reality already exceeds the value of all goods and productivity in existence. This explains the seemingly exponential increase of debt in order to mirror the input of dollars (though, MMT proponents have a different view, but that is a different topic).

You are trying to put dollars into commodity terms, because you don't understand economics deeply enough to understand the dilemma, nor do you understand how debt-based currencies work (or, how they differ from commodity currency). In other words, you are attempting to put numbers together in you own mind, yet do not understand that numbers do not necessarily translate into real capital, real productivity, real THINGS, etc.

You are merely believing accounting fiction and calling it fact (just because it is written on paper, and is something that your mind can actually get itself around). You don't realize that there is always more debt than there is actual money, that the money is merely the principle, and that the interest on that debt exceeds that principle (and, thus can never be paid).

Also, you seem to be confused with regard to the philosophy of libertarianism, and that of the economic science of the Austrian School. While it is often the case that a libertarian may be an Austrian (or, vice versa), they do draw their analysis and theories from entirely separate sources.

While I do love to hear opinions in all matters, it is often helpful if one knows the intricate ideas and theoretical constructs that define the matters of debate. It seems that you have not spent the time to do this. If and when you do spend the years of effort and time to fully study and grasp the ideas of which you espouse to fully understand, then your opinion might have weight. Until then, you are merely one that is ignorant trying to explain something that you do not even command a rudimentary understanding (nor, have you tried to expend an effort to do such).

You're opinion is similar to me attempting to give a weighty opinion with regard to organic chemistry, even though I have only read a few articles or heard the opinions of those who call themselves "organic chemists". Obviously, I would look like a fool... You seem to be content with the same dynamic with regard to yourself.

Yes, I can often go on at length. But, it is only that I like to try to cover all of the bases upon the topic of which I am speaking (I don't like to leave loose ends). But, it is also hereditary (my father was the same way).

At the same time, I tend to read a lot (about 500 pages a week), so writing 5-10 paragraphs feels like a few sentences sometimes. I am not trying to get on a high-horse or to be preachy, I'm just trying to be honest about where I am coming from; I like to write, explain things, and debate.

Though, I must warn you... When I get a good "buzz" going, I can be excruciatingly repetitive and I'll beat a dead horse to oblivion. ;) Hey, at least I am honest about my faults, and I guarantee that you won't see me commenting on shit that I am not knowledgeable of.

You have absolutely nothing for which to apologize, Jaffi --- quite the contrary in fact. That was an outstandingly insightful and logical post, and I hope that you might make more such posts in the future --- this forum would only be the better for it.

You're arguing against points that I never made, which squarely makes you an idiot.

NEVER ONCE! did I say or imply that there is less debt than money. 75% of your post is an explanation of stuff I (and everyone else) already know: there is far more debt than money. What people don't understand, though, is the consequences of that debt overhang. While the sheeple are focused on inflation, the real boogeyman is DEflation. US banks have ~$45T in debt outstanding. God only knows how much of that are frankenstein loans which will continually chase liquidity from the system no matter how much the Bernank prints.

And thanks for the Cliff's Notes explanation of what debt-based currency is all about. I had NO IDEA!! Perhaps you should transfer that post into a binder with some bright colors and rudimentary stick figures, and sell it to your local elementary school.

I'm really not sure how else to respond to your post. You seem to be debating a phantom argument.

Here's a direct question: if the US dollar gets anchored to gold, does that add or subtract from the credit worthiness of US treasuries?

THERE IS A SLAUGHTERHOUSE 40 MILES AWAY, AND I NEVER THOUGHT OF THAT! I KNOW THE SON OF THE OWNER, SO I'M SURE I CAN GET SOME KICKIN' SCRAPS! MAYBE I CAN SELL SOME SCRAPS TO THE LOCAL WALMART TO HELP REDUCE COST-IMPUTS, OR WHATEVER.

May I stand in for you Jaffi, old chap, I got me some of that heredity stuff you were talking so eloquently about too. Unfortunately, my father was a drunken hobo.

Hey y'all there Tex. Lets talk real plain like pawdner. Gold is this thang called munny, A dollah is this thang called a credit note. When thar comes a financial reckanin, them dollars will be worthless 'cos there's just so dang many of them thar critters floatin round. Sorta like a turd in the punch bowl, know what I mean. Now them thar dollahs, that's whut folks use to buy thangs with. Like yo momma. Now if thar's too many floatin' 'round, well doggy, yo mamma is gunna be one high class gal. She ain't a gonna work for cheap now, whut with havin to feed you n'all. Grits don't grow on trees y'all.

Now, the thangs that you buy with dollahs, they'll get more expensive, just like yo momma. That's called inflation or some such fangled werd.

Now boy, I can see that THAT'S MUDDLED AND MUSSED UP YER MIND SOME, so I just thought I'd yell at you tuh bring y'all back intuh focuss.

Now then, thangs that are priced in dullahs are going up, except'n for all tham stable intransitory thangs, like houses and factories and such, Now don't interrupt boy. Whut? No, not that kind a stable) Now, where was I, Oh yeah, they's a goin down. (No, not like your momma. I told you not to interrupt). Oh yeah, they's-a-goin down when you weigh them up against a purty little thang called gold, cos thar's not thet much of it and it's kinda opposite to turds. A dullah is much like a turd too, after while. Cain't buy much with a turd, boy.

Now, nobody likes a turd in the punch bowl, so I suggest you either stop actin like one or stop pretending that you are as dumb as a box of hammers. Y'all can take our advice, or not.

"what happens to the ~$14T in US debt if the US dollar is collateralized by gold?"

That is the statement that I was specifically addressing.

And, you continue with this further question: "if the US dollar gets anchored to gold, does that add or subtract from the credit worthiness of US treasuries?"

You see, I already saw exactly where you were headed with you argument; that the debt is greater than the "dollar denominated value" of gold stock (that seems to be where your position lies). The fact is that we have two choices, we can save our own economy and negotiate with our creditors, and switch to a commodity money. Or, we can ruin our own economy at home and dilute the debt that we owe to our creditors through inflation of our present currency. Since I am not one that wishes to engage in warfare (having already been involved in such) in order to ensure the balances of men that I do not know, I would choose the former option.

The fact is that our current system is unsustainable, and that the only way to keep it going is to increase debt. In order to do that we must also increase our monetary base (of which M1 and M2 can pyramid upon). If we do take this course, then those that hold dollars will not stand idly by and just take it like chumps. Most wars in the last 2 centuries have been a direct result of currency and/or trade wars, especially when foreign nations hold substantial amounts of the offending party's currency. This is something that I wish to avoid.

With regard to deflation, do you even know what deflation is? I'll give you a hint, it is the opposite of inflation, and it involves far more than merely prices. The word inflation was coined in the middle part of the 19th century, and it was entirely with regard to the money supply (back when we were killing each other at the tune of 600,000+ lives). During the early part of the 20th century, there was a distinction made to separate price inflation from monetary inflation (a la Fisher, et al); today almost nobody other than economists talk of inflation other than with regard to prices. A deflation must necessarily be as a consequence of a prior inflation. Yes, we have inflated for many years, and yes there eventually will be either a massive inflation (possibly a hyperinflation) or a deflation (highly doubtful considering current monetary/fiscal policy). However, one path (deflation) is an honest unwinding that plays itself out (more quickly if unhampered) until prices and markets equilibrate, the other (inflation) is an unbridled crackup that always ends in the death of the currency; history tells no tall tales. While neither is optimal, the latter marks the end of a monetary unit of exchange, and cannot be resuscitated.

My goal is not primarily with the debt, but rather to save the structure of the American economy and market itself. Debts can always be renegotiated (especially with a vibrant economy). However, such a vibrant economy cannot be a possibility if we instead decide to try to inflate away our debts, as we have been attempting to do over the course of the past 2 years. We have been lucky to have had a reserve currency for the past 30 years, but that era in history will soon be over. A move toward a production-based currency (a commodity) is the only thing standing between future prosperity and the prospects of war with formidable military powers. If we decide to inflate our way out of our debt, then we will be facing more than a few nations that will be aligned against us. And, we simply will not have the economic wherewithal to win that battle. Unfortunately, our current allies in the world are in just as deeply a decrepit monetary and fiscal position as we are. If we go that route, it will end badly, plain and simple.

I wish to save the nation that I fought to defend, not to watch it die a slow and painful death because the few in charge (and, their close associates) just had to pull the last stitch out of us for their own gain.

I am not sure what QQQBall is getting at, but I think that rather than having a gold backed paper currency with the probability of degenerating into yet another fiat scam inflicted on the people, Zimbabwe should simply use gold and silver coins with the only paper being non-negotiable cheques, letters of credit and other halal insruments (i.e. no trade in promissory notes).

Now, of course, is the right time to rebel against the fiat money scam as the hit squads, assorted assassins, talking heads and liars are seriously overworked in their job of trying to maintain a monopoly on the means of exchange and prevent free trade from breaking out.

I am saying when you have the likes of Zimbabwe piling on the USD and you have folks interviewed at KWN forecasting sky-high gold prices that at least a short-term bottom is in old Uncle Buck... look at the turmoil in Isreal and ME and The Relic opens flat.

I am not sure what QQQBall is getting at, but I think that rather than having a gold backed paper currency with the probability of degenerating into yet another fiat scam inflicted on the people, Zimbabwe should simply use gold and silver coins with the only paper being non-negotiable cheques, letters of credit and other halal insruments (i.e. no trade in promissory notes).

If only the average person could see things as clearly as you do, and as stated here!

Your point about paper vs. coins can NOT be made often enough! As I have mentioned many times, here and elsewhere, NONE of the financial, economic and monetary problems the world is facing today would have occurred, or could possibly have occurred, had we spurned "the Devil's mint" and never allowed ourselves, in our intellectual and pecuniary sloth, to fall victim to paper promises masquerading as real money.

Bretton Woods, the American version of the British gold exchange standard of the early 20th century, has not existed since 1971. We have been on a fiat-exchange floating system ever since. I certainly don't think that the gold-exchange standard (one currency internationally redeemable in gold, but acts as a base to pyramid upon) is any sort of answer to the problems that face this nation, nor any nation of the past. It still allows the ability to pyramid more debt and money upon more debt and money. Britain tried to use it to spread their empire, but they failed due to world conditions. We lucked out when we did it because when we instituted it we had the only viable manufacturing base in the world (Europe and Asia were destroyed by the war), and we had been a net creditor for many years. But, it failed just as it had when the British tried it. The Bretton Woods agreement ended with America's default (the 1971 failure to pay on debts owed).

I don't see Zimbabwe's move as anything other than attempting to save their own economy from the lessons of their own past. When nations see their own demise due to currency inflation, they tend to go back to basics. But, it never lasts long. They'll be back to printing in no time, if not by building upon their gold reserve (FRB), then most certainly they will eventually use a foreign currency to create further deposits.

what the fuck? Is it the responsibility of those dispossessed of their work to leave behind some freebie for the fuckin africans??

In many cases, the settlers were brutally slaughtered. In others, their operating farms and ventures were just stolen by force by the government and divided up amongst the indigenous. Yeah, they pretty much left shit the way it was.

The collapse of the Rhodesian economy was NOT the fault of those who freaking BUILT IT.

If Zimbabwe actually follows through with it, I give it 6 months to a year; we're a little preoccupied with killing other people at the moment (it may take some logistical/accountancy trickery).

After all, we have to spread democracy, and what better way to spread democracy than to scatter some high velocity lead/DU in every which direction? It's a surefire (sic) way to gets the people to the polls.

as nato owns part of libya they also own part of zim...but its the wrong part...with the rocks and arid land. The gold part belongs to babwe..of q-daffy, there he is called q-daddy...and baby loves daddy.

Zimbabwe produces roughly 10 tonnes of gold a year, and 12 tonnes of platinum. Yes, when they had their hyperinflation, mining production fell, but since they began using foreign currencies for exchange, capital investment in mining has continued to increase. They have among the highest platinum reserves, and are in about 130th place for gold reserves.

Considering the fact that they are a small African country who went through a massive hyperinflation, I'd say that isn't that bad.

No, I think that you are the one that is confused. Zimbabwe's all time yearly high for gold production was a total 27 tonnes in 1999 (2700 kilograms/30.24 tons). They still have not surpassed that number. China, the world's largest gold producer was able to produce 340.88 tonnes (340,880 kilograms/381.79 tons) in 2010, which is a little over 1/3 of a kilotonne. There is not a single nation in the world that produces a kilotonne (or, a kiloton for that matter) of gold in a year. Shoot, total world production is less than 2.5 kilotonnes a year (roughly, a total of 2.5 kilotons).

As far as I can tell, many nations in africa still have Au/Ag and precious stones to be mined.

Most of the PMs and Precious stones on american soil have already been unearthed by industrious americans.

Why wouldn't they want a gold standard? Why would the USA? I am not trolling here. And I do think we have bunch of gold in Ft Knox and at the FRB. But I don't think we have enough to win out in a global gold backed currency.

But seriously, I think the US and its citizens should aquire as much gold as they choose to. But wouldn't going back to a gold standard end up the same way it did in the 70's with the US having to settle all its debts in gold, and shipping it ironically, to places like france?

I am being honest about that, because I really don't know how much gold is fort knox, and I am too poor to care.

Oh I hear and appreciate the advice. Debt is bad, whether PMs, Fiat, or any other type. The problem is when in rome, you gotta do what the romans do.

If everybody goes in debt for a college education, even if it is worthless, you gotta have it to get a job. If the cool people roll up to the club in a $50k vehicle, and you show up by your boots, who do you think is going to impress the opposite sex? (yes, women do the shows of status too). If the houses in the only decent school district around require a jumbo loan, what are you supposed to do?

My wife and I are in our mid-to low thirties. She a VP at a midsize company, I a programmer. Combined our household income is in the top 10 percent. Our only debt is about 70k on a house worth substantially more.

Neither of us has a college degree. We do work with college degree entry level people under us, who make about what we pay in federal income taxes each year, who are ladened with debt, generally cannot even afford a house, and marvel at the trips we take, the food we eat, the cars we drive, and the jewelry we wear.

After we pay the bills each month we have about 5k in extra income which we primarily invest.

Have fun in Rome, I decided 10 years ago it was a sham to do as they do, and am happy I did.

Yes, you are correct. If we were to go back to gold at par (or, somewhere near par), we would become dead last with regard to national wealth. Go ahead, look up national account balance... You will find that the US is dead last. Now, the only reason that we have been able to live in our current quality of life is due to our dollar being the reserve. But, I do not seeing this going on forever into perpetuity. China is currently #1 in account balances, and I have an inkling that they know what they are doing.

No matter what we do at this point, we are screwed because we have far more debt and far fewer capital resources (relative to debt) than any other nation. We are going to default any way that you look at it. However, I would much rather default using real money, than to default and have the State steal my wealth. Debts to other nations can always be negotiated, but completely screwing them by diluting their holdings usually only ends one way... War.

Most of our productivity has been siphoned away by inflation and government borrowing (which is paid by exporting inflation). Monetarily, we are at a place where we can continue to do as we have been for the past 30-40 years, and possibly end up in war and currency destruction, or we can negotiate with our creditors and change our inflationary (dollar-debasing) ways. In either case, it will not be pretty. But, I would rather save our own economy and make our creditors happy, than ruin our own economy and piss on our creditors.

One option allows us to improve quality of life at home (based upon current production, and projected production/savings), while being honest with our creditors. The other ruins quality of life at home, and ends up with bombs being lobbed in our general direction care of our creditors. It is a really simple decision if you ask me.

Somewhere long ago in the mid '60s I believe it was, I remember one of those exceedingly small articles, only 3-4 sentences by-lined by a "staff reporter" buried somewhere away on a lower right hand corner of a WSJ page with piles of data/earnings announcements on it noting that the US Treasury had either ordered or taken delivery of some outrageous amount (many thousands?) of tungsten bars weighing something like 440 oz, which at the time I thought to be an odd number, not having any knowledge of LBMA good delivery standards....

The reason that this stuck was that it would have made sense for gold, silver or platinum to be ordered for coinage.... but then again in blank form ready for stamping. Not in raw prefabricated form. But tungsten? I thought that very odd. Very.

2008 In February, rebel forces attempted a coup d’etat in the capital N’Djamena. Although unsuccessful, the attempted coup resulted in several hundred deaths, displaced tens of thousands and prompted the Chadian government to declare a state of emergency. A joint-international mission was deployed in Chad, including an EU military component (EUFOR) and a UN humanitarian component, the United Nations Mission in Central African Republic and Chad (MINURCAT)

2007 The governments of Chad, Sudan and the Central African Republic signed an agreement ... Despite the signing of a ceasefire agreement by the government and four main armed opposition groups, no lasting peace agreement has been reached and armed resistance to President Idriss Deby’s leadership continued to intensify. ... There is concern that investment agreements reached between the government of Chad and China will allow President Deby’s government to purchase additional weapons and ammunition to prolong the conflict.

2006 The creation of a new rebel coalition ... resulted in numerous skirmishes with government troops ... casualties include several hundred ... Tension between the government of Chad and that of Sudan remains high

January 22, 2007: Blackwater USA has made a deal to train security forces in southern Sudan. This region recently ended over twenty years of rebellion against the Arab dominated government of Sudan. Southern Sudan is primarily black, and non-Moslem. The peace deal gave the southerners a great deal of autonomy, and a cut of the revenue from Sudans recently opened oil fields.

To be honest, as an America who also happens to be a vet and an economist, I don't think that America will have the resources, economic power, or the military might to engage in a full scale war in 10 years. We can't even handle Afghanis running around in sandals and small arms, and that is even when we had the most powerful economy in the world to go along with the most powerful military in the world. 10 years from now, our might will not be nearly a fraction of what it is today, just as our might today is only a fraction of what it was 10 years ago.

Throughout history, most imperial nations that took a great amount of resources and lands did so during the height of their power, and even then many of them still failed in the end. America has already crested its peak, so I just do not see what you express to be a realizable reality an actuality in the next 10 years. I certainly don't see the US population going for it with any real fervor.

This headline along with the DSK headline clearly infers bias and an opinion which translates to incitement. News in unbiased and neutral(NO opinion),so to me ZH is grabbing at straws to keep interest and feed the beast. For a site that wants to stand out and represent the real meaning of journalism, ZH is on the wrong track.

PS- if you all would lift you heads out of ZH now and then and browse the MSM headlines, you will see there is not much of a difference. So to keep the crowd, ZH has to use the same tactics.

I junked you, UnRealized, because even though you believe this site to be nothing but trash, you took the time more than half a year ago to register and join, and you're STILL bullhorning your sour attitude.

If you leave, we won't miss you. If you stay, you'll be our punching bag. Your choice...the exit shown to you by traderjoe is always open.